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Centers for Medicare & Medicaid Services

Self-Funded Non-Federal Governmental Plans

Prior to enactment of the Affordable Care Act, sponsors of self-funded, nonfederal governmental plans were permitted to elect to exempt those plans, or “opt out of,” from certain provisions of the Public Health Service (PHS) Act. This election was authorized under section 2721(b)(2) of the PHS Act.

The Affordable Care Act made a number of changes, with the result that sponsors of self-funded, nonfederal governmental plans can no longer opt out of as many requirements of Title XXVII.

This section is intended to provide information about this opt out provision.  The information in this section will be of interest to state and local government employers that provide self-funded group health plan coverage to their employees, administrators of those group health plans, and employees and dependents who are enrolled, or may enroll, in those plans.

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